Think Forex Support and Resistance Always Work? High-Impact News Can Prove You Wrong!
Forex traders often have to come to terms with these two popular concepts - Support and Resistance. A support level refers to the point where buyers have historically come together to prevent the price from sliding further. On the other hand, the point of resistance is where sellers have historically limited upward movement. These two levels form the foundation of many trading strategies employed by traders to spot entry, exit and stop-loss points. However, many beginners begin to think that these price levels are unbreakable. Such assumptions can go horribly wrong during high-impact economic news releases such as inflation reports, employment data, monetary policy announcements by the central bank or any other major news events. These events can trigger price movements so much that even the strongest support and resistance levels can crack within seconds.
